Customer Reviews

The Ultimate Resource 2

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On Sunday, February 8th, psychologist and economist Julian L. Simon succumbed to a heart attack in Maryland. It is difficult to overstate the damage his death will cause the world debate on overpopulation, natural resources, and the environment. Dr. Simon's prolific and energetic mind gave rise to fourteen books and countless papers and lectures, dedicated to overthrowing the dogma that underlies so much of today's environmental discourse.

Simon, still considered a maverick after thirty years of relentless data-gathering, impeccable empirical work, and well-thought out conclusions, questioned the unquestionable. He maintained that the earth is in good shape by every conceivable measure, and that the environmental situation continues to improve each year. Every index of human happiness - food prices, net income, infant mortality, life expectancy, disease rates - has steadily improved. He documented those claims with reams of data, culminating in his 1996 tour de force The State of Humanity. It is absolutely comprehensive, and contains enough obscure data to make the most jaded Trivial Pursuit fan squirm (if you ever want to read about the average lower-class Brazilian's annual starch intake, look no further).

Constantly vilified by his critics, Simon always had a small and devoted following. He was dubbed 'the Doomslayer' by Wired magazine for his repeated skewering of environmental fanatics and 'Birkenstock Puritans.' Perhaps the most memorable episode happened in 1980. Simon wrote exasperatedly in an article that he was sick and tired of environmentalists' insistence that large-scale natural starvation was right around the corner. He invited them to put their money where their mouths were. Paul Ehrlich, the influential author of The Population Bomb and predictor of worldwide famine and resource scarcity for the 1980s, stepped up to the plate. Simon invited Ehrlich and any of his colleagues to choose any five non-government-controlled resources, purchase $1000 worth in any combination, and specify a later date. If the resource bundle went up in price (implicating that they had become more scarce), then Simon would have to pay the difference. If they went down in price, signifying greater abundance, then Simon would receive the difference. Ehrlich and company jumped at this proposition, writing that they were looking forward to cashing in 'before other greedy people see this opportunity.' They chose five heavy metals used as inputs for industry, and specified ten years as the time to wait. And thus it occurred that Ehrlich and his colleagues wrote a check to Julian Simon for $576.80 in 1990. When Ehrlich claimed that it was a fluke, Simon offered to repeat the bet on the same terms, with a new bundle and a new time period. Ehrlich refused, and no one ever stepped up to take his place.

In 1996 Simon updated his classic The Ultimate Resource, in which he claimed that the human mind and human creativity are our best bet to overcome the world's problems. Thus, it's not possible to have too many people. Doomsayers, Simon argues, think of people as merely mouths to feed, rather than individuals with lives, dreams, and ideas. They lament population growth, never once thinking that one of those children might grow up to invent a more advanced farming technique, a cure for AIDS, or a way to construct cheap, safe housing. For the same reasons, Simon argues passionately against immigration restrictions. The only way immigrants can harm their new home countries is by imposing a new drain on the welfare state, and the data show that natives almost always take greater advantage of social programs than immigrants do.

Today, the Unabomber's atrocities find an excuse in his radical environmentalism. Children learn in school that the world would have been better off without them, and that ecological Armageddon is right around the corner. Al Gore writes of a grim future and the need for a 'wrenching' social re-organization to cope with the coming age of scarcity. Julian Simon, conversely, spent his life providing an accessible and empirically sound body of work that challenges the environmentalist agenda. Environmentalists should read his work, to see numerous examples of good science as well as to think long and hard about some of their most cherished and reliable beliefs. Teachers should read it, since they handle and assist the ultimate resource in its earliest stages. But all of us should, at the very least, recognize that the environmental debate has two sides, and that Julian Simon spent his life fighting long, hard, and nobly for his.

Now in a second edition, and what a treat that is, because now the unquenchable optimism and sound forcasting of the first volume is backed up by decades of confirmatory data. Resources of all kinds--foods, metals, energy--are more abundant and cheaper, life expectancy is up, and so is the worldwide standard of living. Why is this so, in spite of the dire warnings (The Population Bomb, Famine: 1975!) of the latest crop of doomsayers? Read the book and find out. Find out also, why these trends show no signs of turning around--why the world will be even richer and more prosperous in the next century.

A reader, in an earlier review, suggests that Simon's ideas are "ridiculous" (in spite of the fact that he has been proven right, time and time again, and the doomsayers have to come out with new books every few years, adjusting forward their predictions of a doomsday that never comes), and goes on to say some very stupid things about "limits to the food supply." Go read them, then consider--that review, like most doomsayers, admits startling progress in increasing food yields, then assumes that such progress is over, or nearly so (six millennia of agricultural advance to the contrary). Why? In the first hundred pages of this book, Simon details cutting-edge technologies being employed commercially _today_ that could raise worldwide food production by orders of magnitude. But the eco-tastrophe crowd keeps talking about "closed systems," in spite of the fact that every new technological innovation keeps making the "system" effectively larger and larger.

Simon's premise is simple: direct measures of material, human well-being correlate positively with population growth and there is no theoretical upper limit. Simply put, things are getting better and better, not in spite of population growth, but because of it! The reason is simple as well: the "ultimate resource" is human imagination and we will not only never run out of it, but we will get more of it as population increases.

This sounds crazy (and I thought Simon was a kook the first time I heard of him), but Simon lays out his theory in detail and shows the overwhelming empirical evidence in favor of it. Simon is not a lone nut, either. The scholarly work in the field of population economics solidly supports his view, even if he may overstate his case sometimes.

This is an update of the original book, so Simon has a chance to answer the critics of the first edition. The poor quality of the critics' arguments, along with their ad hominem attacks, reveals why environmentalist doomsaying is a sad, pathetic, quasi-religion that bitterly opposes examining the facts.

Julian Simon must have been a tenacious SOB. He did a famous 10 year bet with Paul Ehrlich and then tried to renew it. Ehrlich chickened out. He wrote a definitive book on the economics of immigration that suggested that immigration is really a net plus of the nation. In the last few years of his life he took on the gloom sayers and the prevaricators of false science with a vigor that any scholar should admire.

This book is really a reference. It goes through a number of the apocalyptic whiner's best stories and with the care of a good economist debunks both their emotion and their data. Simon was a crusader for rigor in the fields of the social sciences. Like Ronald Coase before him, he was willing to challenge conventional beliefs and then to back his notions up with data. If you want to be armed with lots of data and clear thinking on the environmental issues of our age - you should read this book.

This book is a bombshell. It remorselessly devastates the current ecology doom mongers' shibboleths: population density, resource depletion, pollution, deforestation and species loss. Julian Simon was vilified in his life by the vocal ecology campaigners (special and dishonourable mention should be made of the egregious Paul Erhlich, he of the 'Population Bomb' and other wholly fictitious disasters). Why did Simon attract this venom from people who dub themselves 'scientists'? Simply this: he dared to challenge the orthodoxy that human beings are an ecological cancer that is busy raping the planet and drowning in its own filth. How did he do it? Not with invective, selective quotation and flat-out lies, like the 'deep ecologists' or the Zero Population Growth fanatics, but with facts - cold, hard facts and lots of them. He pointed out that the only economic variable that can properly describe the scarcity of a resource in the absence of full knowledge of its true abundance is price. And he points out that the prices of all resources have been falling relentlessly. This observation led to the well-known $1000 bet with the aforementioned Paul Erhlich, effectively a futures contract, which saw the sadly unchastened Erhlich hand over nearly $600 to Simon. Simon's model for resource usage is that scarcity temporarily drives the price of a commodity up, at which point it is either used more efficiently, or a suitable substitute is discovered. After all, the sole economic value of a commodity is its utility. We value copper for its high conductance. But with the increasing substitution of fibre optics (made from sand - even the environmentalists would concede there is no imminent shortage of this) copper has declined in usefulness, and its price has dropped.

Simon acknowledges that the notion that resources are not finite in any meaningful sense runs counter to intuition, and then shows with a host of examples that intuition is a poor guide to formulating economic and social policy. The book is packed with graphs, charts and tables, all bolstering his point. Perhaps it is this that explains the fury that his ideas received from the radical ecologists - facts are indisputable, and do not fit with the coercive political agenda of those who wish to circumscribe our reproductive capabilities.

Throughout the whole book, a sense of Julian Simon's love of people can be felt. He asks who are we, beneficiaries of the greatest gift of all, life, to decide from our privileged position who shall have life in the future? Pervading the anti-growth movement is the miasma of racism, as evinced by this extract from The Population Bomb, quoted in The Ultimate Resource: "I came to understand the population explosion emotionally one stinking hot night in Delhi...The streets seemed alive with people. People eating, people washing, people sleeping, people visiting, arguing and screaming. People thrusting their hands through the taxi window, begging. People defecating and urinating. People clinging to buses. People herding animals. People, people, people." You can almost hear it: "my dear, the natives, they were everywhere. Beastly, smelly people, little better than rats". The fact that these "human pollutants" have just as much right to existence as any one of us seems to escape the population doomsayers. That they might have children, and love and cherish them just as we in the West love and cherish our children is acknowledged by Simon.

The Ultimate Resource that Simon refers to is human beings, the only resource that appears to be becoming more scarce, as shown by the fact that we are having to pay more for people's services.

Julian Simon's death has left us with a gaping hole in the line of defense against the ecological bunco artists. I hope that someone of similar eminence and eloquence will step up to fill that gap.

The book is an optimistic view of the future of society. It is a welcome relief from the overwhelming tide of bad news based on misinformation that comes from people who have made a lot of money from writing gloomy but inaccurate predictions.

Here is a man whose predictions have come true. He bet Paul Ehrlich in 1980 that the combined prices of any five commodities Ehrlich cared to name would fall over any time period that Ehrlich cared to choose. The deal was that the loser would make up the difference in price over the period. The maximum that Ehrlich could have lost was $1000, while Simon could have lost his shirt (except that, as Simon put it, the bet was "like shooting fish in a barrel"). Ehrlich paid Simon $576.07 after the inflation-corrected prices of all five of the metals he chose fell between 1980 and 1990.

Simon's book is based on long-term economic trends. The world has been getting a better place for people for thousands of years, and Simon suggests that life will continue to improve.

While the book is, for the most part, a joy to read, it is a trifle long and repetitive. I think it would have benefitted from slightly better editing.

However, I commend the book to anyone interested in the future of man and the planet.

The title of this book refers to the human mind. When people are free, and when secure private property rights exist, and when consenting individuals are free to enter into voluntary contractual agreements, and when government activity is limited to proptecting these freedoms and property rights, then human existence will exist in its best possible state.

Julian Simon uses huge amounts of facts, evidence, data, and empirical evidence to show that the overpopulation doomsayers have been wrong about all of their predictions. For example, throughout the 20th century, the average per-capita calorie consumption for the world has been going up. In addition, throughout the 20th century, the real prices of natural resources have been going down, which means that these things have become more abundant.

The problems of hunger and poverty that exist in places such as Ethiopia and Bangladesh are not caused by overpopulation. Instead, these problems are caused by political factors. Thus, reducung the populations of these countries will do nothing to improve the quality of life for the inhabitants of these countries.

Hong Kong is the most densely populated country in the world. And it is also one of the wealthiest countries in the world. Several decades ago, Hong Kong was a slum. But then it adopted a free market economy. As a reult, Hong Kong became wealthy. If countries such as Ethiopia and Bangladesh would adopt free market economies, then they would become wealthy, too.

Julian Simon placed a very high value on the human mind. And it shows in this book. This book is a celebration of life. Julian Simon held a very deep love for the human race. He will be missed by many people.

This book is by the late Julian Simon, a rogue economist famous for his thesis that what environmentalists term "Doomsday" is never going to come. Humanity is never going to run out of seemingly scarce resources such as petroleum, coal, and fresh water so long as patent protection and the price system are allowed to operate freely. This is because human ingenuity will do what is necessary to work around the situation, either by perfecting substitutes or by developing cleverer and cleverer ways to extract the resource.

I'm a big fan of Julian Simon, but feel that, as amazing as human ingenuity is, he nevertheless overstates the case. Take that famous bet with Paul Ehrlich, for example. I think Simon got lucky. Look at the date of my writing: if they had made that bet 5 years ago, and petroleum had been one of the resources on the list, Simon would have lost. Petroleum has gotten more expensive, even adjusted for inflation.

Sure, his basic point is sound - that eventually human ingenuity will find a way around the problem. I agree: eventually. But in the meantime there are killer high oil prices and a lot of suffering and doing without. Simon seems to give that short shrift.

About Simon getting lucky, this isn't just my imagination. Here's Paul Kedrosky with the hard data:

"Without getting into it too deeply, here are some things worth knowing. Given the above graph of the five commodities' prices in inflation-adjusted terms, it will surprise no-one that the bet's payoff was highly dependent on its start date. Simon famously offered to bet comers on any timeline longer than a year, and on any commodity, but the bet itself was over a decade, from 1980-1990. If you started the bet any year during the 1980s Simon won eight of the ten decadal start years. During the 1990s things changed, however, with Simon the decadal winners in four start years and Ehrlich winning six - 60% of the time. And if we extend the bet into the current decade, taking Simon at his word that he was happy to bet on any period from a year on up (we don't have enough data to do a full 21st century decade), then Ehrlich won every start-year bet in the 2000s. . . . [This] means Simon was right but fairly lucky. There is nothing wrong with being lucky, of course, but compulsive Simon/Ehrlich-citers need to be reminded that it is no law of nature (let alone of rickety old economics) that commodity prices (inflation-adjusted or otherwise) trend inexorably downward, even over a decade."

One reader below states that "Julian Simon is an idiot." The late Mr. Simon was clearly anything but an idiot. This same reader goes on to state that "the simple fact of the matter is that ANY level of growth in a closed system is unsustainable over a long enough period of time." That is true enough, but as Professor Simon points out, it isn't the issue. The issue is whether the limits of the closed system are sufficiently proximate so as to be relevant to policy decisions now. Professor Simon offers copious evidence to prove that whatever the ultimate physical limits of population growth might be (sunlight for photosynthesis striking the earth, land surface available for housing and farming), these limits are so very remote to be of essentially zero value in making policy decisions. Professor Simon illustrates this point by the following analogy: It is a generally-accepted fact that our Sun will burn out billions of years in the future. Thus, our Sun is ultimately a "closed system": only x amount of fuel, and then no more sunlight. While we can assume that this fact as true, it manifestly can have no reasonable bearing on our decisions today, since it is simply too remote. Professor Simon argues that the same is true for the carrying capacity for our Earth: ultimately we can perhaps talk about limits to resources, but it is demostrably true based on objective empirical evidence that these ultimate limits are so remote as to reduce them to irrelevance for any matter of public policy. Professor Simon convincingly argues that this is so for food production, living space, metals, wildlife, the environment, etc. I highly recommend reading this book along with Paul Ehlrich's "The Population Bomb." Professor Simon elsewhere shows the implications for the baby bust (to which books like "The Population Bomb" contributed) will have for solvency of Social Security and Medicare, as well as for the national security interests of the United States. I come away with the strong feeling that a furious hatred for mankind lurks behind the ZPG movement. Read this book, and pass it along to your friends.

Professor Simon does state that a large proportion of attacks on his thesis come from biologists, who "...for many decades and centuries - back to Benjamin Franklin...have voiced the strongest fears of population growth...much of what they write...is even outside of ordinary scientific discourse..."

This book is a truly great work and has many fans including the late, great, F A Hayek [from The Ultimate Resource p. 614/615]....

"Dear Professor Simon,

I have never before written a fan letter to a professional colleague, but to discover that you have in your Economics of Population Growth provided the empirical evidence for what with me is the result of a life-time of theoretical speculation, is too exciting an experience not to share it with you...

[Freidburg March 22, 1981]

...I have now at last had time to read [The Ultimate Resource] with enthusiastic agreement...Your new book I welcome chiefly for the practical effects I am hoping from it. Though you will be at first much abused, I believe the more intelligent will soon recognize the soundness of your case...

[Shimoda Tokyu Nove 6, 1981]

With best wishes, Sincerely, F.A. Hayek

This is the opinion of a Sovereign Individual, and does not necessarily represent the opinions of Laissez Faire City.